1984 research outputs found
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New York City’s Annual Income and Expenses: Statement Filing Requirement – a Land Mine for the Unwary Purchaser or Owner of Real Property
No full textSince 1986, New York City law has required owners of incomeproducing properties in New York City to file an annual income and expense statement, colloquially referred to as an RPIE statement, with the Department of Finance. The general purpose of an RPIE statement is to assist the Department of Finance in assessing the value of income-producing properties.1 To this end, the owners of income-producing properties are required to submit annually a statement that outlines “all income derived from and all expenses attributable to the operation of such property.”2 Despite the draconian penalties for non-compliance - ranging from 3% to 5% of the assessed value of the property - a systemic failure of the City of New York to enforce non-compliance over the subsequent decades following the regime’s enactment has led to a general unawareness of the RPIE statement filing requirements in New York City. As a result, potential purchasers of real property have failed to adequately protect themselves - in both the due diligence process and the acquisition agreement - from the consequences of a seller’s historic non-compliance with the RPIE requirements
Boca Bay: The Impact of Insurance Availability on Residential Property Values
No full textThis case study requires students to determine a method for estimating the valuation impact of the changes in access to flood insurance - specifically, changes in the expense associated with the purchase of insurance in the private market. While these expenses have a high degree of certainty, a unique challenge for students in this case is presented by the lack of comparable market transactions involving properties that have been similarly impacted. Quantifying the change in value requires students to adopt the mindset of informed market participants - individuals aware of the differential in insurance expense and who are considering the purchase of the property
A Flow-Through Analysis of the US Lodging Industry During the Great Recession
No full textPurpose – The objective of this exploratory study is to investigate the “flow-through” or relationship between top-line measures of hotel operating performance (occupancy, average daily rate and revenue per available room) and bottom-line measures of profitability (gross operating profit and net operating income), before and during the recent great recession.
Design/methodology/approach – This study uses data provided by PKF Hospitality Research for the period from 2007-2009. A total of 714 hotels were analyzed and various top-line and bottom-line profitability changes were computed using both absolute levels and percentages. Multiple regression analysis was used to examine the relationship between top and bottom line measures, and to derive flow-through ratios.
Findings – The results show that average daily rate (ADR) and occupancy are significantly and positively related to gross operating profit per available room (GOPPAR) and net operating income per available room (NOIPAR). The evidence indicates that ADR, rather than occupancy, appears to be the stronger predictor and better measure of RevPAR growth and bottom-line profitability. The correlations and explained variances are also higher than those reported in prior research. Flow-through ratios range between 1.83 and 1.91 for NOIPAR, and between 1.55 and 1.65 for GOPPAR, across all chain-scales.
Research limitations/implications – Limitations of this study include the limited number of years in the study period, limited number of hotels in a competitive set, and self-selection of hotels by the researchers.
Practical implications – While ADR and occupancy work in combination to drive profitability, the authors\u27 study shows that ADR is the stronger predictor of profitability. Hotel managers can use flow-through ratios to make financial forecasts, or use them as inputs in valuation models, to forecast future profitability.
Originality/value – This paper extends prior research on the relationship between top-line measures and bottom-line profitability and serves to inform lodging owners, operators and asset managers about flow-through ratios, and how these ratios impact hotel profitability
The Role of Ownership in Managing Interfirm Opportunism: A Dyadic Study
No full textWe extend research on transaction cost theory that shows that vertical integration enables firms to protect their investments in exchange relationships better than market mechanisms. However, extant research finds ownership to exacerbate, rather than limit, exchange partner opportunism. Hence, the purpose of this study is to investigate conditions under which ownership can be effective for constraining an exchange partner’s opportunism. Using matched dyadic data for 296 hotel brands, we conduct multi-level hierarchical linear modeling and identify conditions under which common ownership limits hotel opportunism. Findings indicate that ownership can limit hotel opportunism when brand headquarters can easily monitor the hotel’s activities
Diversification Benefits of REIT Preferred and Common Stock: New Evidence from a Utility Based Framework
Get PDFWe study the diversification benefits of REIT preferred and common stock using a utility based framework in which investors segment based on risk aversion. Taking the view of a long run investor, we conduct our analysis using data from 1992 to 2012. We examine optimal mean-variance portfolios of investors with different levels of risk aversion given access to different classes of assets and establish two main results. First, REIT preferred and common stock provides significant diversification benefits to investors. REIT common stock helps low risk aversion investors attain portfolios with higher returns, while REIT preferred stock helps high risk aversion investors by providing a venue for risk reduction. Both asset classes receive material allocations over plausible levels of risk aversion. Second, while REIT preferred stock appears to behave somewhat like a hybrid debt/equity asset, its risk/return profile appears to not easily be replicated by those asset classes. When given the opportunity, investors will reduce allocations to REIT common stock and investment grade bonds and invest in REIT preferred stock
Arbitration: A Positive Employment Tool and Potential Antidote to Class Actions
Get PDFMore than two years have elapsed since employers let out a sigh of relief when the Supreme Court overturned the 9th Circuit decision in Wal-Mart v. Dukes and decertified the class of plaintiffs suing Wal-Mart, the nation’s largest employer, for sex discrimination.1 The class consisted of approximately 1.5 million of the retailer’s former and current female employees.2 While the details of the lower and Supreme Court decisions are beyond the scope of this paper, the lesson for many employers was the fear that class actions, regardless of merit, could put an entire company at risk. While the obvious response, “don’t violate the law,” should seemingly resolve that fear, the fact is that many employment lawsuits, such as wage and hour or discrimination cases, are often difficult to defend. This may occur because: (1) the law is unclear; (2) there are shades of gray in employment decisions, (3) it is difficult to ensure compliance in large multistate or multi-national corporations, or (4) sometimes companies face “bad facts” even when they did not violate the law. Although defending the allegations of one employee or even a group is expensive, most employers are able to do this. Defending a class action, however, often requires resources beyond what many employers can marshal. In this paper, we propose a way to avoid such costly litigation: arbitration
Recovering Conditional Return Distributions by Regression: Estimation and Applications
Get PDFI propose a regression approach to recovering the return distribution of an individual asset conditional on the return of an aggregate index based on their marginal distributions. This approach relies on the identifying assumption that the conditional return distribution of the asset given the index return does not vary over time. I show how to empirically implement this approach using option price data. I then apply this approach to examine the cross-sectional equity risk premium associated with systematic disaster risk, to estimate the exposure of banks to systemic shocks, and to extend the Ross (Journal of Finance, 2014) recovery theorem to individual assets
Compassion at Work
Get PDFCompassion is an interpersonal process involving the noticing, feeling, sensemaking, and acting that alleviates the suffering of another person. This process has recently received substantial attention by organizational researchers and practitioners alike. This article reviews what researchers currently know about compassion as it unfolds in dyadic interactions in work organizations. We begin by reviewing what we know about the benefits of compassion for the person who is suffering, for the provider of compassion, and for third parties who witness or hear about compassion at work. The heart of the article focuses on what research tells us about embedding compassion in the personal, relational, and organizational contexts in which compassion takes place. We conclude by discussing implications for practice and for the future research agenda regarding this vital interpersonal process
The Commercial Lease Free Rent Calculator
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Scroll down to Additional Files to access the calculator.
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The Free Rent Calculator is a tool to help both tenants and landlords when negotiating concessions in a commercial lease. Using market rents as benchmark for negotiation, the actual lease contract information about the tenant’s desired free rent period (in months), tenant improvements, and moving costs; the tool calculates the effective rent that results. Information is presented both in tabular and graphical formats.
Download the corresponding report: Guide to Using the Free Rent Calculator
Hotel Sustainability Benchmarking
Get PDFA landmark Cornell University study has industry-wide data collection and analysis effort to benchmark. This report highlights the results of the first Cornell Hotel Sustainability Benchmarking (CHSB) study which focuses on two key components of sustainability: energy usage and carbon emissions. Monthly utility usage from nine major companies and over 2,000 hotels were analyzed. We present information on the ranges of six energy and carbon key performance indicators (KPI) specifically suited to the hotel industry, with detailed results reported for thirty geographic areas. Three key conclusions are (1) benchmarks based on local geography and chain scale segment are essential for any resulting analysis to be useful to the hotel industry, (2) even for hotels with similar attributes and in the same city, energy per square meter can vary by more than a factor of 5, and (3) there is a continued need for data harmonization to quantify additional drivers of energy use